Issues to be dealt with developing business plan
Developing a suitable business plan is important for any vigilant entrepreneur regardless of the size of the business. A good business plan will be used by an entrepreneur as a direction in setting long term and short term goals and objectives and also as a tool for evaluating performances to determine whether the planned goals and objectives have been met and to make some adjustments for reaching the success of the business. But surprisingly, this process is frequently ignored by many entrepreneurs.
This report includes all the key issues that were supposed to be dealt with by the team members according to the entrepreneur book by Barringer and Ireland, (2008) when developing a feasible business plan. The following issues will therefore be discussed in this report;
Process of idea initiation.
Industry and competitive analysis.
Usefulness of the business plan.
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Covers other areas in the process of developing the business plan.
Team Work and Team Formation
Mifugo Feed Enterprise was formed by four students, namely Angela, Raya, Gladys and I after receiving instructions to do so by the course lecturer Ms Priti.
Team Roles and Specialisation
The roles were divided in four parts which the team members believed that would probably enable it to succeed in producing a good business plan while obtaining the best input from each member, and finally complete the business plan timely. In order to be more efficient, two sub-groups were formed basing on their individual competences.
The 1st group included Gladys and I, our roles being writing of the business after identifying the opportunities, industry analysis by looking at its potentiality, different forces that hinder profitability and size and finally preparing the operational plan by focusing on quality control, customer care and building strong partnerships e.g. suppliers.
We entrusted Angela and Raya to take care of marketing by focussing on different strategies and financial projections for five years. This is because in previous studies they were involved in resolving different problems in those areas. Finally, every team member found a place where she was most enthusiastic to contribute.
After all roles being gathered and analysed, we prepared the Executive summary as a group output.
Contribution of Team Members and Efficiency
Each team member participated effectively when performing the assigned tasks, shared knowledge and responsibilities and generated new ideas for reaching the team's success. Contribution among team members was high due to eagerness, open communication, understanding, collaboration, commitment, high spirit, respect and valuing other members' opinions. We consistently contacted each other using mobile phones, and e-mails to be informed on how far each one had gone and what materials had been gathered before we met twice a week. This information enabled the team to accomplish the business plan on the set time.
Working in a team was a challenge thus required great heart for tolerance and respect to each other more than anywhere else as each member believed that she was right on her views and ideas. There were minor disagreements on reaching consensus, but finally all conflicts were resolved amicably by respecting and adapting others' differences. This arrangement created room for each member to be free in contributing productive ideas that enabled us to come up with successful business plan.
III. Process of Business Idea Initiation
The group thought that it was wise for each member to brainstorm rather than all members, so that each member could probably come-up with 1 viable, concise, unique and convincing business idea which will be easy for us to select from other alternatives. This technique thus led the group to two prospective ideas;
We agreed on these two potential business ideas and brought them to our lecturer Ms Priti asking for advise and approval. She appeared to be very interested in the Livestock Feed business idea and advised us to proceed with it and leave the Diagnostic Centre because of it being too expensive in both start-up and operating expenses.
Reflection on the process of Idea Initiation
The process takes a time lag because of undertaking different analyses from diverse sources in order to determine opportunities and threats to reduce the possibility of ending up with business failures while increasing chances of success. To ensure this, we undertook secondary research work using books and websites that are related to livestock feeds. We also conducted primary research by asking livestock farmers on their opinions with regard to the existing livestock feeds situation. We discovered that existing livestock feed producers charge high prices on low quality products while consumers are experiencing chronic inadequate supply. Thereafter, we went to the Ministry of Livestock and Fisheries' feed section, where we obtained useful information about livestock feeds. They also explained much to us about feeds and encouraged us to implement our envisaged business plan in order to overcome inadequate supply of feeds. After conducting this research, we had vital information concerning the market growth, saturation and intensity of competition.
What I have learned
This essay is an example of a student's work
I learned that it is very crucial to undertake a detailed research and become more creative when initiating a viable business idea in order to find a feasible business which its window of opportunity is still open and finally enter in the right industry at the right time.
IV. Industry and Competitive Analysis
Identifying the gap in the market
We identified the gap in the market using market feasibility analysis as well as observing the livestock feeds trend. We finally discovered that there was an increasing demand and prices while supply of quality livestock feeds tends to be inconsistent as a result of raw materials being dependent on seasonal changes.
Identification of the Industry
The MFE team confidently believed that we have chosen the right and profitable industry to enter after undertaking the industry analysis using the Michael Porter's 5 forces. These five forces are; suppliers power, threats of new entrants, buyers power, threats of substitutes and rivalry among existing companies. The analyses help the team to determine suitable strategy in order to penetrate the livestock sector after taking not of the strengths, weaknesses, opportunities and threats posed of the sector.
Gaps in our Marketing Plan
The process of developing the marketing plans has shown there are no gaps in our business plan because we considered all aspects equally e.g. business environment, marketing mix, marketing strategies, fixing potential markets etc.
Identification of key Competitors
We identified our key competitors such as companies producing livestock feeds e.g. Igo animal feeds, Interchick etc using competitor analysis.
Livestock feed companies such as Igo, Falcon, Interchick, Banana, Mamo, A-Z and BAF that use the whole cereal grains.
Green pastures farmers.
Small livestock feed producers.
Producers of natural pastures.
Itinerant traders selling fresh grasses along main roads like Kawawa, Mandela, and Kigogo in Dar-es-Salaam.
Missed Key Competitors
We missed to identify few direct competitors due to lack of in-depth research. Moreover, these competitors are not well established and known although they offer similar livestock products at more reduced prices but have insignificant stock supplies while MFE has a wider range.
Market research, knowledge of livestock feeds and competitor analysis helped the team members in competitor's identification. These sources of information assisted us in not identifying wrong competitors. All the mentioned competitors in our business plan are the right one.
V. Presentation Experience
Contrary to report paper, presentation is regarded as being the best way which permits a face to face communication among all participants and the panel. It moreover allows participants to initiate confident dialogue and a flow of information which keeps the panel interested throughout the presentation. However, report paper takes time to read and identify all crucial points that are intended by the writer while at the same time leaving doubtful areas.
It is very essential to present the business plan not only to win audience's confidence but also to assure them the viability of the business plan. Presentation also creates a room for receiving criticism, questions and views for better improvement of the business plan.
VI. Alternative Scenario
A successful entrepreneur is the one who has the ability to predict market conditions and potential business growth as her/his key success factors, since the macro-environment critical factors like economic growth, customer demand, intensity of competition and social conditions may favour or hinder the business growth. However, the more business environment uncertainties anticipated, the high chances of success the business will have.
The team has predicted a smooth growth of its business not only on the products market that it intends to serve at its initial years of operations but also the plans in the near future to have additional sales stores in the area where the number of livestock farmers is significantly high while increasing exports to international markets.
On the enterprise level, later on we would decide on focusing on other strategies such as arranging for collaboration with key competitors if an enterprise will not reach its expectations. The last alternative that might be undertaken is to sell shares to general public or the business.
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Looking back at our business plan, we found out that our predictions to be just about right.
The business plan has growth trajectories into the areas of farmers centre and livestock farming consultancy. Taking the advantages of fast movers in producing livestock feeds from beer brewing wastes, the firm will offer free consultations on how to use our products for better results while offering varieties of livestock drugs in the same centre.
VII. Usefulness of the business plan
A feasible business plan can be used as a direction by the firm in achieving its planned goals and objectives. If planned well it might be useful for a long time even more than the business life span, but ignorance or less attention of some areas in the business plan may hurry it to be outdated. A balance between diverse areas of the business plan should be created.
A business plan can also be used as a tool to measure the firm's performance.
VIII. The areas that can contribute or limit the growth of our business
Financial strength encourages the growth of any firm especially when it is projected and controlled in an appropriate way while considering all accounting rules. But it can also hinder the firm's growth due to increased inflation rate as well as future lending interest rates. MFE intends to consistently supply its livestock products to a wider uncovered area where there are a large number of livestock farmers and to go internationally as the business grows. This will enable the firm to acquire a competitive advantages over its competitors while in turn increases its profitability.
One of the areas that I would like to congratulate the University of Greenwich via Small Business Development subject is when deciding to introduce group forming in preparing the business plan. I finally realized that in today's business environment, working in teams is inevitable because it enables the firm to enhance productivity from different experience and capability of team members. I also learned that disagreements during preparation process of the business plan enabled the team to yield more productive ideas which lead to a better and successful business plan; this proved that not all the time conflicts are bad.
I learned a lot during the process of the business plan preparation especially the involvement of team work. The sharing of different ideas from team members, task allocation and specialisation basing on member's capabilities were the route which enabled the team to accomplish a quality business plan within the given time. Frankly speaking, I enjoyed working with this group, it is a remarkable team, and I dare to say that everyone would probably admire to be in it.
X. REFERENCE AND BIBLIOGRAPHY
1. Mifugo Feed Enterprise Business Plan, (2010).
2. Barringer, B.R. and Ireland, R.D. (2008), Business plan outline, Successfully Launching New Ventures. 2nd Edition, Pearson Prentice Hall.
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